Sensex surges 550 points, Nifty above 24,400, led by PSU bank stocks; ITC, Varun Beverages face GST heat

Adani Ports, Shriram Finance, SBI, HDFC Bank, and Adani Enterprises were the top gainers on the Nifty.

Benchmark indices Nifty and Sensex opened the trading session in green on December 3 and extended gains for a third straight session as PSU bank stocks helped bolster bullish sentiments. GST rate rationalisation proposals for aerated beverages, cigarettes, and tobacco weighed on major stocks like ITC, Godfrey Phillips and Varun Beverages.

This week, markets will also be taking cues from RBI's MPC meeting scheduled for December 4. A Moneycontrol poll of analysts and fund managers suggests that the central bank will likely keep interest rates unchanged.

At about 11:15 am, the Sensex was up 564.08 points or 0.70 percent at 80,812.16, and the Nifty was up 153.80 points or 0.63 percent at 24,429.85. About 2450 shares advanced, 904 shares declined, and 105 shares unchanged.

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"The market's undertone remains positive, as there are no immediate negative triggers and weak GDP figures were already priced in," said Ajit Mishra, Senior Vice President at Religare Broking, in a conversation with Moneycontrol. He noted that investors are now eyeing government support through capital expenditure, which could further bolster sentiment. The central bank could cut CRR which could boost liquidity While the pace of FII selling may ease by mid-December, Mishra expects it to continue until early 2025.

To be sure, foreign institutional investors (FIIs) sold Rs 239 crore to kickstart December while domestic institutional investors mopped up Rs 3,588 crore.

Also read: ITC, Godfrey Phillips shares in focus as GST panel suggests 35% tax for cigarettes, tobacco

Tobacco major ITC tanked 3 percent after the Group of Ministers on GST rate rationalisation recommended raising tax on aerated beverages, cigarettes, tobacco and related 'sin' products to 35 percent from the current 28 percent. Pepsi bottler Varun Beverages opened 5 percent lower in today's session.

Newly-listed food delivery major Swiggy rallied 4 percent ahead of its Q2 earnings, the first since its debut last month. Prosus, one of the company’s largest shareholders, said in its half-yearly disclosures that Swiggy has reported a revenue of $750 million (around Rs 6,300 crore) in the first half of the financial year 2025 (H1FY25), up 40 percent from $536 million (about Rs 4,500 crore) recorded during the same period last year.

Read more: Godrej Properties QIP saw four-fold demand, Pirojsha says funds to help in growth

KPI Green Energy shares rallied over 3 percent after receiving its largest order worth Rs 1,311 crore from Coal India. The company is going to set up a 300 MWAC (405 MWDC) ground-mounted Solar PV plant including Operation & Maintenance (O&M) services on a comprehensive basis for five years on an engineering, procurement, and construction basis in Gujarat.

The mid-small cap indices outperformed the frontline indices with gains of 0.6 and 0.5 percent, respectively. Market experts suggest that BSE Small-Cap and Mid-Cap have seen a decent correction in the past two months and could likely see renewed buying interest in the coming weeks. Smallcap stocks saw a strong rally on Tuesday, with 750 BSE Smallcap stocks trading in the positive, while 173 stocks declined. Midcap stocks also witnessed a similar trend as 100 shares rose, while just 29 traded in the negative.

Nifty Bank, PSU Bank and Metal Index rallied the most, rising 0.5-1 percent. Gains in major banking names such as SBI, HDFC Bank, IndusInd Bank, and Shriram Finance lifted the index. The Realty index pared gains to trade in the negative.

"Immediate support is placed at 24,000 and 23,900, historically strong reversal zones that may present buying opportunities if confirmed by favourable price action. On the upside, 24,350 serves as the first hurdle. A decisive breakout above this level could drive the index toward the next resistance targets at 24,800 and 25,000, unlocking significant upside potential," Mandar Bhojane of Choice Broking said. "Traders are advised to adopt a cautious stance and wait for confirmation of price action at key support and resistance levels before initiating fresh positions," he added.

Shriram Finance, SBI, ONGC, Cipla and L&T were the top gainers on the Nifty. ITC, Trent, Bharti Airtel, HDFC Life, and Hindalco were the key laggards.

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